Open-ended equity NFOs collect Rs.6,612 crore in FY 2017-18

Thanks to the market rally, many investors have lapped up new open-ended equity schemes.

In FY 2017-18, new fund offers of open-ended equity schemes raised Rs.6,612 crore, shows AMFI data. The funds mobilised by new funds offer increased by 664% or Rs.5,747 crore in the last financial year.

AMFI data shows that while the industry launched 12 open-ended equity funds last fiscal, seven open-ended schemes were launched in the preceding fiscal.

Industry experts attribute this to the market rally. “During a market rally, many new investors enter the markets. These investors do not distinguish between a new scheme and a scheme with a track record. Also, the Rs.10 NAV attracts many investors,” said Vidya Bala, Head of Mutual Fund Research, Fundsindia.

Kaustubh Belapurkar, Director, Fund Research, Morningstar India believes that fund houses launch new open-ended schemes to complete their products basket. “Although the numbers look large, the total collection from NFOs is hardly 6% of the overall equity flows. Many fund houses launch new open-ended schemes to complete their products basket,” said Kaustubh.

However, not all new schemes have collected significant inflows. A lion’s share of these inflows has come to Axis MF. “Axis Mutual Fund is a well-established fund house with good fund management, which helped the fund house to collect assets,” added Kaustubh.

Axis Mutual Fund launched two funds – Axis Dynamic Equity Fund and Axis Multicap Fund – last fiscal. While the fund house collected Rs.1,700 crore during NFO of Axis Dynamic Equity Fund, Axis Multicap Fund collected over Rs.2,000 crore.

Funds raised by open-ended equity funds (quarter-wise)

Figures in Rs.crore

Source: AMFI